IT was a fitful start for China’s newly appointed chief securities regulator, with share prices continuing their wild gyrations in his first week on the job.

Liu Shiyu, a banking veteran appointed to replace Xiao Gang, has landed in the hot seat with a mandate to modernize the markets without roiling them. He is the eighth chairman in the 24-year history of the China Securities Regulatory Commission.

On February 22, the first day after his appointment, equities tracked by the Shanghai Composite Index rose 2.4 percent. But the optimism proved short-lived as shares crashed on February 25, plummeting more than 6 percent.

Liu was born in 1961 in the Year of the Ox. The pronunciation of his surname resembles that of the Chinese word for “ox,” and the fact that oxen are just a breed of bulls hasn’t gone unremarked.

“With a chairman born under the ox sign, how can the A-share market not be bullish,” Li Daxiao, chief economist of Yingda Securities, wrote on his Weibo account.

The change of leadership came after months of boom and bust in China’s stock market, mostly blamed on excess leveraged buying.

Xiao and the commission were widely criticized for allowing grey-market margin loans for stock purchase to pile up, leading to a speculative bubble that drove market value to more than double in just a few months.

Then came a crash that has wiped out more than 40 percent of the value of China stock markets since their highs early last summer.

Adding to the woes, a circuit-breaker system introduced by the regulatory commission at the beginning of this year proved to be a disaster by only worsening volatility. The system was scrapped after it exaggerated sell-offs and caused the complete shutdown of trading twice in its four days of implementation.

Heads had to roll.

Xiao, 57, previously head of the Bank of China, was appointed chairman of the CSRC in 2013. In a statement released on the commission’s website in January, Xiao reflected on the financial turbulence.

“The abnormal volatility reflected immature investors, an incomplete trading system, a flawed market system and an inadaptable regulatory system,” Xiao said. “It also exposed loopholes, maladjustments and the ineffectiveness of CSRC supervision.”

In short, a load of travails dumped in the lap of his successor. Analysts and investors are now looking for clues on Liu’s attitude toward financial market regulation.

In comments to senior commission officials after he took up his new duties, Liu indicated that the regulator’s main tasks are strict market supervision and a rigorous crackdown on market manipulation, Bloomberg News reported last week, citing an unidentified source.

Liu also said the regulator would actively channel funds into the market, according to the report.

Liu was born in Jiangsu Province and initially studied hydraulic engineering at Tsinghua University. He eventually received a double master’s degree in engineering and management, and later a doctorate in economics.

Low-key man

From 1987-1996, he worked in Shanghai’s economic structural reform office. He later was tapped for the National Office of Structural Reform before taking on executive duties at China Construction Bank. In 2002 he was named head of the administrative office at the People’s Bank of China and was appointed deputy governor of the central bank in 2006. In October 2014, he was named chairman and Party secretary at the Agricultural Bank of China, the highest-ranking position at the bank.

Liu has a reputation as a diligent, pragmatic and low-key man, according to financial magazine Caixin, which cited central bank sources. The report said Liu is good at balancing the interests of different parties and is a quick learner in areas new to him.

In trying to assess his motivations, analysts are scouring his past public comments.

In 2014, Liu said building a multilayered capital market was the key to addressing various market issues and stressed the need to boost the financing capacity of the capital market.

In 2011, he said the development of debt and stock markets would be impeded if innovative products, such as credit default swaps, were not introduced.

“He’s a reform executive who has participated in the restructuring of financial institutions, the reform of state-owned banks and rural financial reform,” said Fu Yang, analyst at AVIC Securities. “There are high hopes for Liu to press ahead with innovation and reform.”

One of harder nuts for Liu to crack is the overhaul of China’s much-vilified initial public offering system.

At present, approval of new stock listings rests with the Issuance Review Committee of the CSRC — a panel of 25 members with absolute power over who can go public. The system has long been criticized for its inefficiency and its secrecy.

Hong Hao, equity strategist of Bocom International Holdings, said Liu’s challenge is to implement a registration-based listing system to improve the efficiency of the market as a financing instrument.

The commission was poised to introduce a registration-based system last year, but turmoil in the market led to a suspension in new share offerings and set back the reform process.

The process is expected to resume soon. China’s top legislature has authorized the government to implement changes to IPO system starting from March 1, removing legal barrier to the reform.

Some investors are uneasy about the looming new system. They worry it will result in a flood of new listings that will dilute the value of existing shares. That was one reason cited for the market meltdown in late February.

Analysts said it will be a tricky task indeed for Liu to roll out a registration-based IPO system while trying to maintain investor confidence.

“To press ahead with IPO reforms in an orderly and gradual manner while easing investor fears about increased listings is a big challenge,” said Pi Haizhou, an independent financial columnist.

Some beg to differ.

Liu Shengjun, deputy director of the CEIBS Lujiazui Institute of International Finance in Shanghai, said reform is always a “no-pain, no-gain” process and the regulator should not delay reforms simply because they may lead to some drops in the market.

“The stock market has its own laws of rising and falling,” he said. “The role of the regulator is market supervision, not obsession with fluctuation of market indexes.”